THE MORTGAGE PROCESS

+ Find out how much you can borrow

Approach CMS to arrange an ‘agreement in principle’ from whichever mortgage lender is most suitable for your needs and whose criteria you fit, there is no point applying to a lender if they would not lend to you due to VISA status or employment or credit history.

Once this is done you will have an idea of what lending is possible potentially and you can start looking for properties. Estate agents are starting to check to see if you have an agreement in principle in place when making offers as it shows you are serious about proceeding.

When you start house hunting, it can be both an exciting and a daunting time with so many options available but knowing how much you can borrow (using your agreement in principle as a guide) will allow you to narrow your search and make the right decision.

Use our Mortgage Calculator to help get things started.

+ Make your offer

Once you find your dream home, you need to put in an offer. The key to negotiating is to know what you can afford to pay and how much you believe the house is worth.

You can check what the house was previously bought for using websites that display the selling prices for houses by postcode or street name. This knowledge will help you keep tpo realistic budgets and will help to ensure you don't pay over the odds for a house in your chosen area. Once you have made an offer you will then liaise with the estate agent who will act as a go-between for you and the seller.

Stick to your guns and don't be seduced into steadily increasing your offer so that it becomes above what you can afford. Not only will you be likely to regret paying too much but it may also prove impossible to secure the mortgage you need if the lender judges that you are paying over the odds for a property. You will need to agree a final price for the property and once this has been set you can start the buying process.

+ Contact CMS to start the mortgage application and instruct a solicitor

Once you have agreed a purchase price for the property, CMS can kick start the mortgage application process.

We will be asking you for all the documents the lenders is going to need such as identification and proving income bank statements etc. At CMS we will have provided you with a checklist via email to enable you to tick off the required documents applicable to the chosen lender. At this stage you will also need to instruct a solicitor.

+ Searches and building surveys are carried out on the property

Having already agreed to lend to you during the application for an agreement in principle, the mortgage lender must now ascertain whether they want to lend on the property that you have chosen.

A number of checks are carried out in order to assess whether or not the property is worth what you have offered to pay for it. These checks include area searches, building surveys and land surveys and are designed to find out if your property is a secure long term investment. It will highlight whether your property is built in an unsafe area (for example on contaminated land) or whether there are structural problems such as subsidence which may damage the property. Some of these checks are carried out by your solicitor and some by the lender itself. In most cases these checks bring up minor issues that can often be ignored.

However, if there are any more serious issues, you can negotiate with the buyer to get them resolved before you move in as a condition of the sale, or you can negotiate to reduce the purchase price to allow for these unforeseen costs. Sometimes the lender may insist that these problems are dealt with before they will agree to lend against the property.

+ Mortgage offer will be produced

Once all of the searches and surveys have been completed and any potential problems dealt with, your lender should issue an ‘offer’. When this happens, we would be contacting you confirming that your application is going ahead successfully and you can then contact your solicitor to inform them that they can press on with finalising the purchase.

+ Your solicitor will contact you to ask you to sign the contracts

Whilst the searches are being performed on the property and the mortgage lender is investigating any queries, the next step is for both parties to sign the contracts this will allow you to Exchange contracts.

+ Your solicitor will request your deposit money and exchange contracts

Now comes the scary bit...

Your solicitor will contact you to request your deposit money which is normally around 10-20% of the purchase price. This is transferred to your solicitor so that they can hold it for you between exchange of contracts and completion. When you exchange contracts your deposit is handed to the buyers and acts as a binding agreement between you and the seller. Your solicitor will handle this for you so you don't actually need to meet with anyone. Once you have paid your deposit, the seller must go through with the sale or will have to return your deposit, but if you pull out of the purchase then the seller is able to keep your deposit as compensation. If you are selling a house at the same time, it is likely that all or part of the deposit on your new home will only be acquired from the sale proceeds of your current property. Your solicitor should offer a facility to cover the deposit money between exchange and completion. Amongst the excitement of exchanging contracts, it is easy to forget that the property is now probably your most valuable asset to protect and look after. For that reason, it is essential that you take out building and preferably contents insurance to protect your home and belongings against loss or damage.

+ You agree a completion date. The mortgage advance is requested and deeds transferred

The only thing that you will have to do at this stage is to agree a completion date with your solicitor, which they will then negotiate with the seller's solicitor. Once you have agreed this completion date with the seller, you or your mortgage broker will liaise with the mortgage lender to make sure that they are ready to release the funds before this date. The final stage in the process of buying a home is conducted behind the scenes by your solicitor. The mortgage advance will be requested by your solicitor so that the funds have cleared in time for completion. They will then send the transfer deeds to the seller’s solicitor and once these have been received the sale is complete.

+ The purchase is completed and the estate agent will hand you the keys to your new home!

Now that the property is yours you can pop open the champagne....congratulations, you are now the proud owner of a property!

The process works differently in Scotland so get in touch and we can go through this with you.